Is liquidity the missing link?

Durand et al. (2006a ) argue that the Australian market is both internationally integrated and domestically segmented. They find that the US‐based three‐factor model captures returns of the largest stocks in Australia (evidence of international integration), but that it is unable to account for the returns of the smallest stocks (evidence of domestic segmentation). This study resolves the puzzle left by Durand et al. (2006a) . Incorporating a liquidity factor provides the missing link in their analysis: it results in a model that permits both the international integration of the largest stocks and the model can account for the returns of the smallest stocks. Our analysis highlights the important role of liquidity in Australian asset pricing.     

Simulated financial dealing room: learning discovery and student accountability

This paper identifies the effectiveness of a simulated treasury dealing room for teaching and learning. It uses a presurvey and a postsurvey to establish student perceptions of learning effectiveness. It concludes that students believe that the dealing room: (i) improves their opportunities to apply theory; (ii) provides better learning than lectures; (iii) is more effective than individual learning; (iv) improves student monitoring of learning effectiveness; and (v) improves student abilities to recognize ethical issues, develop alternative solutions to ethical problems, and evaluate solutions to ethical problems from a moral point of view. Student motivation is enhanced by: (i) the high value they place on dealing room learning; (ii) their preparedness to participate; (iii) rapidly reduced levels of anxiety about trading; and (iv) the learning resources provided.     

Managing disabilities in an integrated health environment: the experience of Aetna

Disability-related outlays are increasing at a rate well above the medical inflation rate. This article discusses the experience of one company in its attempt to manage these skyrocketing costs, by developing a new program that integrates health and related benefits by combining the medical and human resources interventions into a unified program. The authors discuss the initiation, development and progress of the program, concluding with measured results revealing reduced lost work time, improved employee health and productivity, and reduced disability costs.     

Seize the moment: Opportunism in Australian capital markets

This paper examines theories of capital structure using a dataset of listed Australian companies from 1993 to 2005. Companies appear to have target leverage but they take advantage of favorable firm characteristics to achieve these targets. Issuers issue debt when they are profitable. When firms are profitable and perform well in the market, they will issue both debt and equity.     

Managing foreign subsidiaries: agents of headquarters,or an interdependent network?

In this study, two different theoretical perspectives are used to develop sets of hypotheses regarding the mechanisms used to manage foreign subsidiaries of multinational corporations. First, agency theory serves as the basis for a model that predicts the use of monitoring mechanisms and incentive compensation. Then, it is argued that these mechanisms are insufficient for managing subsidiaries characterized by high levels of intra‐firm international interdependence, the management of which is critical to many of today's complex global firms. A second set of hypotheses is argued, linking international interdependence to several social control mechanisms. Primary and secondary data from U.S. based multinational corporations were used to test both sets of hypotheses. The results indicate that agency theory, although a useful foundation for studies of control within MNCs, is limited in its ability to explain fully the phenomenon of foreign subsidiary control, however, the model based on intra‐firm interdependence had much greater predictive ability. Copyright © 2000 John Wiley & Sons, Ltd.